After ten long years of costly and continuous litigation, two very courageous and persistent Idaho Farm Bureau member families have prevailed over the United States in their cases to prove that they own water rights on federally administered lands.

Tuesday, March 25, 2008

POCATELLO – Chalk one up for Goliath (in this case, the federal government), even though he got whupped by David (two Idaho ranching families).

By refusing to hear a landmark Idaho water rights case, the U.S. Supreme Court has made it official: an individual can defeat the U.S. government in court in every major battle but lose the war.

The court declined to hear a case involving two Idaho ranching families who fought the government for nearly a decade over federal rangeland water rights.

That means the two families, who were victorious in their cases, cannot recover attorney fees. Essentially, they’ve reached the end of their road in legal terms and face a bleak financial outlook after a long battle to defend their stock watering rights.

The two ranches were vindicated earlier this year when the Idaho Supreme Court ruled the federal government does not hold federal rangeland water rights. The ranches won on every major point and the court even said the government’s argument reflected “a serious misunderstanding of water law.”

However, in a serious setback to the ranching operations, the court also ruled they could not recover attorney fees from the government. Considering they owe about $1.5 million combined – an amount roughly equal to the value of the ranches -- that’s no small matter.

The two Owyhee County ranches, Joyce Livestock Co. and LU Ranching Co., appealed the court’s decision not to award them attorney fees to the U.S. Supreme Court. They found out Oct. 31 the court would not hear their appeal.

“We knew going in the Supreme Court took a mighty small percentage of cases,” said LU Ranching owner Tim Lowry. “We were hoping against hope they’d take this one. But they didn’t.”

Lowry said their next step would be “to figure out how to get the attorneys paid. Our options are pretty limited.”

The Idaho Supreme Court agreed with the ranches on virtually every point in their battle with the federal government over water rights on land covered by federally administered grazing allotments.

The operations ended up fighting the government in state court after the Bureau of Land Management challenged their stock watering rights during the Snake River Basin Adjudication.

Though the fight was long and complex, the court’s logic in deciding in favor of the ranching operations was simple when broken down.

The court ruled that while the operations’ predecessors staked their water claims by grazing livestock beginning in 1898, the BLM couldn’t put the water to beneficial use because it doesn’t own cattle.

But it’s the court’s ruling on attorney fees that has threatened the financial viability of the ranches.

Before he took the fight to court, Lowry said, government attorneys warned him they would challenge him all the way to the U.S. Supreme Court and that the fight would cost his the value of his ranch in attorney fees.

Because they knew they were right, Joyce Livestock and LU Ranching refused to be intimidated. In the end, they were proven right. Unfortunately, in one for the “How does that happen?” department, the government’s threat to break them financially also came true.

In a nutshell, the two ranches won their case on every major point. But in the end, because they can’t recover attorney fees, they have lost from a financial standpoint.

The ranches based their claim to be allowed to recover attorney fees on the Equal Access to Justice Act, which provides for the award of attorneys’ fees to individuals and small businesses that prevail in litigation against the government.

The act is designed to deter the U.S., with its deep pockets, from litigating against private parties without any basis in law by penalizing it when it does so. It levels the playing field by enabling these parties to litigate their claims against the U.S. despite limited financial resources and the likelihood of great litigation expense.

But the court denied the ranches’ claim based on its interpretation of a jurisdictional issue – whether a private citizen can receive an award of attorney fees under the EAJA from a state court adjudicating water rights where the U.S. appeared in the adjudication under the McCarran Amendment’s waiver of sovereign immunity.

The court ruled the EAJA does not authorize state courts to award attorney fees against the U.S.

The ranching operations pointed out that Congress enacted the act as a means to enable individuals to fight against unreasonable governmental action. Limiting EAJA to federal courts, they argued, would create “an incentive for the executive branch to engage in forum shopping when subjecting small businesses and individuals to unreasonable governmental action.”

Lowry said the loss of attorney fees means the government can thumb its nose at landowners in fights over natural resources. They can now take the stance that “It doesn’t matter if we’re right or wrong, we’ll force you to settle.”

But, looking at it in a different light, the fight could also prove to be advantageous to other landowners who face similar government action.

The Idaho Supreme Court ruled the U.S. did not act frivolously or without foundation in asserting its water rights claim. However, the fact that the government doesn’t hold federal rangeland stock water rights is now settled law in Idaho.

So, if the government forces the issue on another landowner, the individual would not have to fight them step by step since it is settled law.

“The law is pretty clear now,” Lowry said. “The Idaho Supreme Court has spoken on it and pretty clearly.”

If the government does push the issue in light of the Supreme Court ruling, he added, “it would be absolutely frivolous and without merit” and the individual would presumably be allowed to recover attorney fees because of that.

Thursday, March 20, 2008

MURPHY--In Idaho apparently you can trample your foe in battle but still lose the war. Sadly, that could turn out to be the case in a landmark water-rights battle between two Idaho ranching families and the federal government.In that case, the Idaho Supreme Court ruled this year the federal government does not hold federal rangeland water rights. However, the court also ruled the ranchers were not entitled to recover attorney fees, a decision the families have appealed to the U.S. Supreme Court.

The two ranches in Owyhee County have challenged the government in state court for a decade and have refused to back down in a case they see as an issue of right vs. wrong. But the financial future of both operations is in jeopardy as the case now heads to the highest court in the land.For the families of LU Ranching Co. and Joyce Livestock Co., there’s no backing down now, and surrendering was never an option for them.“No. Never,” says Tim Lowry, owner of LU Ranching, when asked whether he ever considered giving up. “There have been times when we have been awfully discouraged, but we knew when we went into this we were right and what the federal government was doing was absolutely wrong.“It was a fight that needed to be fought.”

The implications of the case for other landowners are huge. A victory would give other farmers, ranchers, landowners, and small businesses the assurance they can stand up for what’s theirs and not risk losing everything, he said. A loss means individuals litigating against the federal government in state water-rights adjudications would be better off abandoning legitimate claims simply because they can’t afford to defend their rights against the government.

“Though we knew the expense of time, effort and attorneys’ fees would be great, we continued on, fighting for justice and to set a precedent for all public land users that private parties do have rights on public land,” said Paul Nettleton, managing partner with Joyce Livestock.The two families earned a significant court victory earlier this year that could assist hundreds of thousands of property owners in the West in their battle with the federal government over natural resources.The Idaho Supreme Court ruled in their favor in February on virtually every point in their long-running battle with the federal government over water rights on land covered by federally administered grazing allotments.But the court also ruled they could not recoup attorneys’ fees from the United States.

If the U.S. Supreme Court doesn’t take the case or rules against them, both ranches will be in deep financial trouble. Legal fees for the two families combined are nearing $1.5 million.Lowry says the attorney fees are about equal to the value of his ranch. If they aren’t allowed to recover them, the ranch will be in big trouble financially, he said.“If the Supreme Court will not take this case or takes it and rules against us, I’m not real sure what we’ll do,” he added.

The two ranches ended up fighting the government in state court after the Bureau of Land Management challenged their stock watering rights during the Snake River Basin Adjudication.During the SRBA, the U.S. filed overlapping claims to Idaho ranchers’ stockwater rights. The SRBA court ordered the parties to try to reach a settlement. Most ranchers accepted a settlement because they feared the financial risk of fighting the deep pockets of the government.Virtually every rancher in Idaho was forced to compromise their water rights to avoid a protracted fight with the government.While others gave in because of the risk, LU and Joyce decided to defend their rights against long odds.

Nettleton said they knew the government’s claims were baseless and went against Western water law. “The Bureau of Land Management never owned a cow,” he says. “How could they claim beneficial use?”The odds are great, he adds, “but we haven’t been here for 142 years by rolling over and letting folks walk on us when we know we are right.”Lowry said the settlement meetings were intimidating. Whereas ranchers walked into them alone, not thinking they would need an attorney to defend themselves against their own government, the government had a fleet of BLM water rights personnel and Justice Department attorneys present.When the government realized they weren’t going to give in, they resorted to what Lowry calls extortion tactics. He said they very pointedly told him they would contest his claims all the way up to the U.S. Supreme Court and that it would cost him the value of his ranch in attorney fees.

“In essence, they said, ‘You’ll be broke at the end of this court battle,’” Lowry said. “It was very pointed: ‘If you want to go down this route, we’ll break you.’”Instead of intimidating the two ranching families, however, it made them dig in.“It just made you mad,” Lowry says. “The government must not be allowed to run over private citizens because citizens cannot afford to protect themselves.”

An SRBA judge ruled in 2005 that the ranchers did have water rights but he issued priority dates later than 1934, which made the ranchers’ stockwater rights junior to the BLM. The ranchers then appealed, and the cases were litigated and appealed through state courts up to the Idaho Supreme Court.Affirming a district court ruling, the Idaho Supreme Court ruled the operations’ predecessors staked their water claims by grazing livestock beginning in 1898. That predates the 1934 Taylor Grazing Act.

“Joyce Livestock’s predecessors obtained water rights on federal land for stock watering simply by applying the water to a beneficial use through watering their livestock in the springs, creeks and rivers on the range they used for forage,” the Supreme Court ruled.They said the BLM couldn’t put the water to beneficial use because it doesn’t own cattle. Therefore, it can’t have a stockwater right.The court overwhelmingly rejected the United States’ position and ruled in favor of the two ranches on all of their substantive water rights claims. It said the government’s argument “reflects a misunderstanding of water law.”However, the court denied the families’ request to recover attorneys’ fees.

Now the two ranches have appealed that decision to the U.S. Supreme Court.The ranchers base their claims to be allowed to recover attorneys’ fees on the Equal Access to Justice Act, which provides for the award of attorneys’ fees to individuals and small entities that prevail in litigation against the government.The court ruled the EAJA does not authorize state courts to award attorney fees against the United States.

Tim Lowry, Rancher

Tim Lowry gets ready for spring branding

Paul Nettleton, Rancher

Nettleton at his 107 year old rock barn

Their story

This victory has cost these families dearly, in terms of emotional wear and tear and financial strain. The families have incurred well over $1 million in legal fees while standing up for what they know is right and proving once and for all that all Idaho ranchers who put water to beneficial use on federally administered lands legally own water rights.

The United States realized that most people don’t have either the fortitude or the resources to resist their claims that the U.S. owned the water. The federal government counted on the necessity of individuals and small businesses to abandon legitimate water rights, no matter how baseless the United States’ claims were, simply because the individuals cannot afford to defend their rights against the U.S.

What the federal government didn’t figure on was Tim Lowry, Paul Nettleton and their families having the courage, determination and fortitude necessary to stand up for their rights, in the face of extreme legal fees, and prove the U.S. government wrong.

Their victory is a victory for all of us. All agricultural or mining operations which utilize water on federally administered lands have more secure rights based on this important legal case.The following legal points were won in the Idaho Supreme Court:· The ranchers own state water rights on federally administered lands· The priority dates of the water rights date back to when the water was first put to beneficial use· The state water rights are appurtenant to the ranch property and need not be specifically listed on the deed· The U.S. government does not own and cannot hold stock water rights.

Unfortunately, these families now face the very real threat of losing all they have worked for by being faced with legal bills impossible for them to pay. This is where you come in. We are asking you to join with us to contribute towards the legal fees that have set a precedent for all Idaho families who graze on federally administered land.

How You Can Help

Join the fight, send a message, show you care. Send as much as you can afford to: Agricultural and Environmental Research Foundation, C/O Idaho Farm Bureau Federation, 275 Tierra Vista Drive, Pocatello, ID 83201

The Lowry's and Nettletons need to pay off their $1.5 legal bill, send this link to all your friends then post your thoughts on this blog.